Property Insurance Trend

[gregb]

Posted by Denis elsewhere-

 

[Terrel L. Shields]

I would say much of that relates to local building costs and home prices. Here our building costs have almost doubled since 2018 and insurance for my own place is up about 40%. Most insurance claims are not total losses here. We have wind, hail and tornado damage. House fires are down the list and wildfires like CA suffers, are rare indeed.

 

[Fernando]

I'd been paying my upcoming insurance and they went up a lot this year over 35% from last year.
The big increase in insurance is making it hard to make money on my rentals.

 

[Gobears81]

Insurance companies are getting quite litigious on claims and aggressive about kicking customers off if they don't do what is needed. I had a roof that had some life left on it, and they sent out a drone that decided that the roof needed to be replaced. When I didn't oblige, they kicked me off, and in between the cancellation date and the expiration date of my previous policy, a hail storm came through that resulted in new gutters, siding, and roof. I had been a customer for 18-years with only one small claim until then, so I certainly wasn't too upset to see this, but the storm chasers and "consultants" are increasing rates for everyone.

My market has held up surprisingly well, but some are starting to think that values are starting to decline. I'm not sure about that just yet, but operating costs would undoubtedly be the primary culprit. Utilities and insurance seeing huge increases, plus the assessors becoming extremely aggressive and applying multipliers that are not reflective of appreciation in commercial properties. 10 - 15-years ago, the assessor's opinion of value might have averaged about 70% - 75% of what actual market values are, now it is close to 100% and I am seeing almost as many over-assessed properties as under-assessed properties. When the effective tax rates are about 3%, it is not uncommon for RE taxes to be higher than all other operating expenses combined.

 

[Bill75]

I can say at least here in Texas, insurance is going down, but you need to call at least 10 companies every year to reduce it. I have changed insurance carriers every year since 2018. No loyalty for me unless you happen to reduce my premiums without calling. I believe the reduced rates are due to the reduction in property values over the last few years. Funny though my property taxes keep going up...

 

[Fernando]

I haven't seen such crazy increases.
I had one that went up to $8,000 and later after I complained, it went down to $6,000.
Currently I have one gone up $5,500 from $3,200 last year and after complaining went down to $4,400.
I have another one with State Farm increasing $1,000 from last year.
I guess I should be grateful it's only a $1,000 increase.

 

[chad hampton]

My mtg is up 30% over the last 5-8 years due to primarily insurance. A little for taxes. I can't imagine being on a fixed income and having these increases.

 

[Joe Flacco]

$200 per quarter is not so bad.

 

[glenn walker]

Not just structures but liability claims in litigious states like California are what's driving costs up rapidly.